The model stock plan

Bibliographic data

Monograph

Identifikator:: 1820833348

URN:: urn:nbn:de:zbw-retromon-210730

Document type:: Monograph

Author:: Filene, Edward A. http://d-nb.info/gnd/123562244

Title:: The model stock plan

Place of publication:: New York

Publisher:: McGraw-Hill Book Company

Year of publication:: 1930

Scope:: xiv, 253 Seiten

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XIV. Helping producers eliminate waste

Collection:: Economics Books

HELPING PRODUCERS ELIMINATE WASTE 207 don’t want you to make this quantity any larger than you reasonably believe will be profitable, for that would not work out to our advantage any more than it would to yours. We shall carry a reserve stock, so that for two weeks after you receive your goods we can ship on receipt of your reorder anything that you have sold out. This will permit you to make your profits on novelties in money instead of in stale goods. “You know that no manufacturer of stylenovelties has ever before been able to do this because he has found no way of making it profitable. But we expect to get orders like yours from one retailer in every town. Consequently, we shall have a total volume on these goods large enough to let us produce them in greater quantities than any manufacturer has ever done before. This gives us a much lower production and selling cost. You will, in turn, be able to sell greater quantities of them because your lower prices will bring them within reach of a much larger number of your customers.” This novelty plan is cited simply as an example of the kind of thinking that a manufacturer may profitably find himself doing when he understands how the Model Stock Plan can fit into his own and his customers’ businesses. An understanding of the Model Stock Plan will also show a manufacturer that at the very most he can safely sell to one retailer or a chain not more than 50 per cent of his output. As we have seen in our early examination of the plan, an important part of the improvements possible in distribution arises from the compulsion of competition. If the producer knows that his whole output will be taken by one customer, the fear of being beaten by competitors is removed or at least weakened to the point where he no longer is spurred to doing his very best and then excelling it. It is equally expensive to the retailer who buys too large a proportion of a producer’s output, for the retailer is no longer getting in his goods the benefit of initiative equal to the producer’s when he first established this firm connection. By the same line of reasoning, a retailer should not manufacture roods for sale in his own store. If he tries it the head of his

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